The performance of private equity

How returns developed

Business & Finance, Finance & Investing, Finance
Cover of the book The performance of private equity by Jörg Eschmann, GRIN Publishing
View on Amazon View on AbeBooks View on Kobo View on B.Depository View on eBay View on Walmart
Author: Jörg Eschmann ISBN: 9783640784608
Publisher: GRIN Publishing Publication: December 27, 2010
Imprint: GRIN Publishing Language: English
Author: Jörg Eschmann
ISBN: 9783640784608
Publisher: GRIN Publishing
Publication: December 27, 2010
Imprint: GRIN Publishing
Language: English

Scientific Essay from the year 2010 in the subject Business economics - Investment and Finance, , course: -, language: English, abstract: The European private equity market had achieved a considerable volume until 2008. Reasons for increasing the volume can be seen in the favourable economic development, low inflation and strong competitive pressure on the part of financial intermediaries. These led to falling swap spreads on the financial markets and increased the investors' risk tolerance. Then, in September 2009, the investment business was depressed. The dreariness in the business with private equity participations or buy-outs could already clearly be read in the half-year figures on the market. The amounts invested also declined by just over one third. Due to a lack of awareness, private equity is still frequently associated with high risk. Investing in an individual company can sometimes be fraught with risk. Since private equity funds work in a highly specialised way and concentrate on specific sectors or industries, the investment in a single private equity fund can also be risky. The risk of default of an umbrella fund with investments in approx. 20 or more target funds, however, is very low due to broad diversification. While additional costs are incurred for the investor for the services provided by the umbrella fund, the expected return is still clearly double-digit, even after subtracting these costs. The average annual return on private equity is regularly 3 to 5% above the average annual yields of stock investments. Recent studies provide evidence that companies that were sold by private equity investors achieved an annual growth in value of 24% to 29% - comparable listed companies managed added value of only nine percent. Private equity investments are investments in not listed companies with a high risk of default, low fungibility and transparency. A higher return on the investments is inevitably necessary - and feasible.

View on Amazon View on AbeBooks View on Kobo View on B.Depository View on eBay View on Walmart

Scientific Essay from the year 2010 in the subject Business economics - Investment and Finance, , course: -, language: English, abstract: The European private equity market had achieved a considerable volume until 2008. Reasons for increasing the volume can be seen in the favourable economic development, low inflation and strong competitive pressure on the part of financial intermediaries. These led to falling swap spreads on the financial markets and increased the investors' risk tolerance. Then, in September 2009, the investment business was depressed. The dreariness in the business with private equity participations or buy-outs could already clearly be read in the half-year figures on the market. The amounts invested also declined by just over one third. Due to a lack of awareness, private equity is still frequently associated with high risk. Investing in an individual company can sometimes be fraught with risk. Since private equity funds work in a highly specialised way and concentrate on specific sectors or industries, the investment in a single private equity fund can also be risky. The risk of default of an umbrella fund with investments in approx. 20 or more target funds, however, is very low due to broad diversification. While additional costs are incurred for the investor for the services provided by the umbrella fund, the expected return is still clearly double-digit, even after subtracting these costs. The average annual return on private equity is regularly 3 to 5% above the average annual yields of stock investments. Recent studies provide evidence that companies that were sold by private equity investors achieved an annual growth in value of 24% to 29% - comparable listed companies managed added value of only nine percent. Private equity investments are investments in not listed companies with a high risk of default, low fungibility and transparency. A higher return on the investments is inevitably necessary - and feasible.

More books from GRIN Publishing

Cover of the book Les 'lettres théologiques' de Dietrich Bonhoeffer by Jörg Eschmann
Cover of the book Der Expressionismus, die 'Brücke' und Karl Schmidt-Rottluff by Jörg Eschmann
Cover of the book George Orwell, Nineteen Eighty-Four: Winston Smith's rebellion by Jörg Eschmann
Cover of the book The British Empire and its colonial legacy by Jörg Eschmann
Cover of the book Surviving as a 'Software as a Service' (SaaS) Startup by Jörg Eschmann
Cover of the book Sexual Violence as a Weapon of War in Sub-Saharan African Conflicts by Jörg Eschmann
Cover of the book Tekrum Marketing Plan for Malaysia by Jörg Eschmann
Cover of the book Gute Aufgaben im Mathematikunterricht der Grundschule by Jörg Eschmann
Cover of the book (Post)structural notions of language and history in the novels of Julian Barnes by Jörg Eschmann
Cover of the book Aspects of Welsh English on the Example of 'My Neighbours' by Caradoc Evans by Jörg Eschmann
Cover of the book 'Together they would be complete' Female Doubles in C. P. Gilman's 'The Yellow Wall-Paper' and H. James's 'The Bostonians' by Jörg Eschmann
Cover of the book Ardis, its Ardors and Ideologies - Measuring Vladimir Nabokov against Hélène Cixous by Jörg Eschmann
Cover of the book Comparative Study of the Capabilities of Various Micromachining Processes by Jörg Eschmann
Cover of the book The history of Spitalfields by Jörg Eschmann
Cover of the book What determines the Success of Mergers? by Jörg Eschmann
We use our own "cookies" and third party cookies to improve services and to see statistical information. By using this website, you agree to our Privacy Policy